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Confirmation the Roxburgh Stand Children's Services camp will remain closed is ''the final blow'' to those who had hoped the service might be reopened, Central Otago Mayor Tim Cadogan says.

Stand Children's Services chief executive Dr Fiona Inkpen yesterday said the Roxburgh camp would not reopen in any capacity and administration of the site was being handed back to the Department of Conservation (Doc).

Dr Inkpen said after the camp's closure in July ''the hope was that we would be working with the Government at some stage to reinstate such a service in that [Roxburgh] region''.

But when it researched alternative possibilities for the camp, it was discovered Stand was only the administrator of the land, not the owner.

''It is because it is health camp reserve, so it has a reserve status and so we don't actually own the land, we have been the administrators of the land,'' Dr Inkpen said.

''We didn't fully understand that until recently.''

Mr Cadogan said the news would come as ''the final blow to those who had held hope that the village may have one day reopened''.

''It is a sad day for Roxburgh and for the children of the South and is the somewhat inevitable conclusion to the despicable decision by Oranga Tamariki, condoned by its minister Tracey Martin, not to give the increased funding required to keep the village operating.''

Doc statutory land management adviser Ken Stewart said Doc was processing Stand's request.

''They [Stand] have asked the Department of Conservation, the owner of the site on behalf of the Crown, to revoke the vesting in them [Stand].''

Doc would be contacting the Central Otago District Council to see if it had any suitable alternative public community use before a decision was made, Mr Stewart said.

''As the land is a reserve there are limitations as to what it can be used for. The district plan will also need to be complied with.

''If there are no other suitable community local purpose uses and revocation is approved, the land reverts to Crown land and disposal is undertaken by Land Information New Zealand.

''As part of the process the history of ownership is investigated, which may result in the land being offered to former owners or Te Runanga o Ngai Tahu,'' he said.

The return of the land to Doc administration opened the door to conversations about how the former children's camp might be able to be used, Mr Cadogan said.

''That may lead to a more positive outcome for Roxburgh than a mothballed situation such as we have had, although nothing will replace the village in the hearts and minds of the people of Central and the greater South.''

Dr Inkpen said there were about six staff working from the village site who would be relocated in the region.

''We are probably looking at establishing our regional office in Alexandra.''